Key Points
- GM has recalled every Chevy Bolt ever made, about 153,000 vehicles, on concerns about battery fires.
- LG has agreed to cover the cost of those recalls, nearly $2 billion.
- GM and LG will begin replacing defective battery modules this month.
Investors in General Motors (NYSE:GM) who have been worried about GM’s massive $2 billion recall of Chevrolet Bolts for battery fires can breathe easier: GM said on Tuesday that a corporate sibling of its battery-cell supplier, LG Chem, has agreed to cover nearly all of the bill.
GM had already said it is recalling and checking every Bolt ever made, and that it will replace the batteries in any vehicle that is at risk of catching fire. But it wasn’t until today that it became clear which company would be paying that massive bill.
What GM said: LG will foot the bill for the Bolt recalls
GM said in a statement on Tuesday that LG Electronics, another unit of Korean giant LG Group, has agreed to reimburse the automaker for “costs and expenses associated with the recall of Chevrolet Bolt EVs and EUVs due to manufacturing defects in battery modules supplied by LG,” about $1.9 billion.
GM and LG expect to begin replacing defective battery modules this month.
Notably, GM also said that LG remains “a valued and respected supplier” and that the two companies will continue to collaborate on electric-vehicle components.
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